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Targa Resources Corp. Message Board

  • mizzou1966 mizzou1966 Sep 16, 2013 10:30 AM Flag

    Barclays CEO Energy-Power Conference 9-11-13

    Not a lot new in the formal presentation; however, for serious investors, it is a worthwhile read and listen to CEO Joe Bob Perkins' presentation. He was really excited about the recent and programed (2013-14) expansions. Targa is firing on all cylinders. The Galena Park Marine Terminal expansion is just one part of the growth story. The photoshopped picture of the terminal showing the completed and (immediate) future expansions is worth more than words alone can describe. IMO. TRGP has an excellent chance for a 100%+ total return over the next three years. Key dates: Next dividend/distribution announcements for the Targa twins is mid-October. Next earnings release should be in very early November. Next investor presentation is schedule for (about) the same time. This presentation should have the forecasts for 2014. For 2014, I look for TRGP dividend target of +25-30% and NGLS distribution increase ~+10%.

    Sentiment: Buy

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    • Considering investing in TRGP but help me get comfortable with the massive debt of this company. It blows away all of their peers. On that note, is everything good that will ever happen to this company already priced in? I like the story very much but on every metric I look at, PEG, Debt to equity, price to book, etc. IT SEEMS OVERVALUED! Looking for the counter argument and appreciate serious responses. Ken

      • 2 Replies to govpur
      • TRGP has acted very nicely coming into the Q4 (based off of Q3 performance) dividend announcement. Even with today's 2% decline, TRGP is up from 68.69 one month ago (close on 9/3/13). I look for the dividend to go from .5325 to at least .57 (a 7% increase and an annual rate of 2.28. Fair Value looking at just the dividend (of 3.0-3.1%) is in the 73.55-76 range. If the dividend gets a larger increase, dividend related Fair Value could go as high as 76.66. Keep in mind that Targa Resources is +38.7% YTD, based on the current quote of 73.30. I do not see much upside through Q4; however, if EPS, CF, and dividends are strong in 2014, 95+ by 4Q2014 is realistic. Disclosure: I have added 200 more shares to my position here in the 72-73 area. Average price is still in the mid-60s. Continue to be a very happy, long term shareholder. GL

        Sentiment: Buy

      • Ken, Looking at compliance debt/EBITDA; KMP is at 3.8X (recent range 3.2-3.8X) vs NGLS at 4.1 (recent range 2.5-4.1X and target range 3.0-4.0X). Current figure is high because of new project and should be back in or under the target range in the next few quarters. If NGLS does well, TRGP will do much better. I like the growth (most likely double over the next 3-4 years) and the relative small market cap. I do not like the tax problems with MLPs; however, if you know of other interesting GPs, please describe. GL

 
TRGP
136.60-0.75(-0.55%)12:01 PMEDT

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